SINGAPORE: Oil prices fell on Friday after the White House delayed a decision on U.S. involvement in the Israel-Iran conflict yet they remained on course for a third consecutive weekly rise.
Brent crude futures were down $2.57, or around 3.3%, to $76.28 a barrel by 1204 GMT but still set to gain nearly 3% on the week.
U.S. West Texas Intermediate crude for July – which did not settle on Thursday as it was a U.S. holiday and expires on Friday - was up marginally at $75.19.
The more liquid August contract was up around 0.4%, or 31 cents, to $73.19.
On Thursday prices jumped almost 3% after Israel bombed nuclear targets in Iran, while Iran - OPEC’s third-largest producer - fired missiles and drones at Israel. Neither side showed any sign of backing down in the week-old war.
Brent prices retreated after the White House said President Donald Trump would decide whether the U.S. will get involved in the Israel-Iran conflict in the next two weeks.
“However, while Israel and Iran carry on pounding away at each other there can always be an unintended action that escalates the conflict and touches upon oil infrastructure,” PVM analyst John Evans said.
Iran has in the past threatened to close the Strait of Hormuz, a vital route for Middle East oil exports.
However, oil exports so far have not been disrupted and there is no shortage of supply, said Giovanni Staunovo, an analyst at UBS.
“The direction of oil prices from here will depend on whether there are supply disruptions.”
An escalation of the conflict in such a way that Israel attacks export infrastructure or Iran disrupts shipping through the strait could lead to $100 per barrel of oil being a reality, said Panmure Liberum analyst Ashley Kelty.
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